Aurelia Butler

OTTAWA (Reuters) – The front-runner to head Canada’s Conservatives and likely challenger to Liberal Prime Minister Justin Trudeau is staging a rare series of attacks on the central bank as inflation soars, in a strategy to win party leadership that could hurt his chances in a general election.Since February, Pierre Poilievre, a bespectacled 42-year-old suburban Ottawa lawmaker dubbed “Skippy” for his youthful enthusiasm, has marched ahead in the Conservative leadership race by tapping into angst over pandemic restrictions and vaccine mandates.Instead of targeting any of his five opponents in the leadership race, Poilievre (poh-LEE-ev) has made his attack of the central bank a cornerstone of his campaign as inflation surges to a three-decade high.But his threat last week to fire Bank of Canada Governor Tiff Macklem if he wins a national election drew criticism from both inside and outside the party.Former Bank of Canada Governor David Dodge said Poilievre’s onslaught may win him Conservative leadership but would not help him become prime minister.”Is (Poilievre) damaging the central bank? I don’t think so,” Dodge told Reuters. “Is he damaging himself as a potential prime minister? Absolutely.”A minister in former Prime Minister Stephen Harper’s government, Poilievre is tapping into Canada’s populist right by blaming “elites” and “gatekeepers” for high living costs while pledging to make Canada “the freest country on earth.”While economists credit Bank of Canada’s record-low interest rates and aggressive bond-buying program for keeping the economy afloat during pandemic lockdowns, Poilievre says the central bank has become “Trudeau’s ATM” and blames the policies for hot inflation.The bank has ended its bond-buying program and is in the process of raising rates to cool what it calls an “overheating” economy.Poilievre declined to be interviewed for this story. The party contest will end with a vote in September, and the next federal election is due in 2025.Among Conservative voters, 56.5% say they prefer Poilievre compared to 14% for centrist Jean Charest, his closest rival, according to an Ekos Research poll this month. TRUMP POPULISTS The attacks come at an awkward moment for the bank, and both Macklem and Senior Deputy Governor Carolyn Rogers (NYSE:ROG) have made rare concessions this month, saying high prices may be undermining public trust in the institution. Bank of Canada’s main mandate is to control inflation.Frank Graves, president of pollster Ekos Research, said Poilievre “is nurturing exactly the same forces that (former U.S. President Donald) Trump nurtured.” Graves calls this voter pool “ordered populists” and says they share the same values on both sides of the border, including a “deep institutional mistrust.”In February, when protesters railed against vaccine mandates and COVID-19 restrictions, paralyzing Ottawa for three weeks, Poilievre served them coffee and echoed their rage in parliament.Similar to U.S. Senator Rand Paul’s past push to audit the Federal Reserve Board, Poilievre wants the Bank of Canada bond-buying program to be audited.Derek Holt, head of capital markets economics at Scotiabank, said he viewed Poilievre’s attacks “as political rhetoric with low probability of policy changes.”Politicians have taken aim at the Bank of Canada in the past, once in the late 1950s and early 60s, which ended with the bank’s policy-setting independence being enshrined in law, and again in the 1990s by former Liberal Jean Chretien.Trudeau is defending the bank.”Canada has one of the most respected central banks in the world, and it is so because of its independence from political actors and political interference,” Trudeau told Reuters in an exclusive interview this month.Another Poilievre promise is to make Canada the “blockchain capital of the world,” saying alternative currencies like bitcoin will “let Canadians opt out of inflation.””That’s total nonsense,” Dodge said. “There is a global economic system … and you can’t sort of stand totally aside from that system.” More

BERLIN (Reuters) -Germans went to the polls in Germany’s most populous state on Sunday in a vote that poses an early test for Chancellor Olaf Scholz’s Social Democrats five months after he took office with a domestic policy focus that was quickly eclipsed by the Ukraine conflict. The centre-left Social Democrats (SPD) have dominated North Rhine-Westphalia (NRW) — home to more than a fifth of Germany’s population and to the rust-belt Ruhr region — for most of the past half century.But the party lost to former Chancellor Angela Merkel’s conservatives (CDU) in its worst state election in 2017, under attack for its failure to tackle traffic jams and a rising crime rate. A few months later, it also suffered a record defeat at the federal level.”North Rhine-Westphalia always sends an important signal for federal politics,” said Nico Siegel, the executive director of pollster Infratest dimap. Ahead of Sunday’s vote, the two parties were very close in the polls, with the CDU having a slight lead at 32% versus 28% for the SPD in a survey published by INSA on Thursday.”An election victory would radiate, in a positive sense, into discussions about the SPD’s strength in the federal government and Olaf Scholz’s popularity,” Siegel saidThe NRW election is also seen giving a boost to Germany’s environmentalist Greens party, which could become kingmaker.The CDU has governed the state in a coalition with business friendly FDP since 2017. But even with its slight lead over the SPD, it might not be able to secure a majority with just the FDP, which stood at 8% in the polls.The Greens most recently polled around 16%, which means either party is likely to need the Greens to form a state government.LOCAL ISSUESLast week, the CDU won by a landslide in the considerably smaller northern state of Schleswig-Holstein, but in NRW it will have a much harder time securing votes.Local issues such as affordable rents and public transport are usually what determines voters’ decisions in state elections.Siegel said there was no dominant topic determining voters’ behaviour across parties. In 2017, the CDU won the vote by focusing its campaign on traffic jams, rising crime and an underperforming education system.Manfred Guellner, head of pollster Forsa, told Reuters that job security and the impact of structural change from the dismantling of the coal-fired power plants were important issues on voters’ minds.The CDU’s win in Schleswig-Holstein was seen partly driven by the popularity of state premier Daniel Guenther. In NRW, its candidate Hendrik Wuest only just took office in October and has not had time to build a following.After casting his vote in a polling station in Rhede, a cheerful-looking Wuest said the good weather made it a great day to vote, asking his state’s citizens to take part in the ballot. Wuest is running against Thomas Kutschaty, the SPD candidate, who served as a minister of justice in the state from 2010 until 2017. Kutschaty voted in Essen in a classroom where he started school in 1974.”That was a moving moment for me right now,” Kutschaty told reporters.The fact that the state is the home turf of CDU leader Friedrich Merz is also not expected to help the party win the election. A Forsa survey published on Wednesday showed that only 13% of Germans believe that Merz would be a better candidate for chancellor than Scholz.”To put it bluntly, Merz does not help at all, on the contrary,” Forsa’s Guellner said. More

SHANGHAI/BEIJING (Reuters) -Shanghai will gradually begin reopening businesses such as shopping malls and hair salons in China’s financial and manufacturing hub from Monday after weeks in strict COVID-19 lockdown, while Beijing battles a small but stubborn outbreak.All but shut down for more than six weeks, Shanghai is tightening curbs in some areas that it hopes marks a final push in its campaign against the virus, which has infuriated and exhausted residents of China’s largest and most cosmopolitan city.Shopping malls, department stores, and supermarkets will begin resuming in-store operations and allow customers to shop in “an orderly way”, while hair salons and vegetable markets will reopen with limited capacity, Vice Mayor Chen Tong told a media briefing on Sunday.He gave no specifics on the pace or extent of reopenings, and many residents in the city of 25 million reacted online with scepticism.”Who are you lying to? We can’t even go out of our compound. You can open up, no one can go,” said a user of China’s Twitter-like Weibo (NASDAQ:WB), whose IP showed as being from Shanghai.During Shanghai’s lockdown, residents have been mainly limited to buying necessities, with normal online shopping largely suspended due to a shortage of couriers. And while barbers and hairdressers have been giving haircuts on the street or in open areas of housing compounds, residents recently able to leave homes for brief outings to walk or buy groceries have generally appeared more dishevelled than usual.In one hopeful sign, Shanghai’s subway operator began testing trains on its vast network in preparation for reopening, a local government media outlet reported, but gave no indication of when it will do so.Shanghai residents have been frustrated by unclear or inconsistent rules as the city makes tentative steps towards easing curbs.In the Changning district on Sunday, a woman began walking her dog before being told by a policeman to go home.”The lockdown hasn’t lifted!”, the policeman shouted.OUTLIER APPROACHChina’s strict “dynamic zero” approach to COVID has put hundreds of millions of people in dozens of cities under curbs of varying degrees in an attempt to eliminate the spread of the disease. The curbs are wreaking havoc on the world’s second-largest economy and rattling global supply chains even as most countries try to return to normal life despite continued infections.New bank lending hit the lowest in nearly four and half years in April as the pandemic jolted the economy and weakened credit demand, central bank data showed on Friday.The Asian Football Confederation said on Saturday that China had pulled out of hosting the 2023 Asian Cup finals due to COVID, the latest in a wave of sporting event cancellations by China and prompting social media speculation that its zero-COVID policy could persist well into next year.China managed to keep COVID at bay after it was discovered in Wuhan in late 2019, but has struggled to contain the highly infectious Omicron variant. The World Health Organization said last week China’s approach was not “sustainable”.Still, China is widely expected to stick with its approach at least until the congress of the ruling Communist Party, which is historically in the autumn, where President Xi Jinping is poised to secure a precedent-breaking third leadership term.Despite the disruptions, no senior Chinese officials have spoken out publicly against a COVID-19 policy that Beijing defends as saving lives.Case numbers in Shanghai continued to improve, with 1,369 daily symptomatic and asymptomatic infections reported, down from 1,681 a day earlier. Importantly, the city reported no new cases outside of quarantined areas after finding one a day earlier. Consistently achieving zero cases outside quarantined areas is a key factor for officials determining when they can reopen the city.Shanghai has achieved its zero-COVID target in more thinly populated suburban districts and started easing curbs there first, such as allowing shoppers to enter supermarkets, but it continued to tighten restrictions in many areas over the past two weeks, curtailing deliveries and putting up more fencing.In Beijing, where restaurants have been shut for dining-in, several districts on Sunday extended work-from-home guidance and officials announced three more days of mass daily tests for most of the city’s residents.Beijing said it found 55 new cases in the 24 hours to 3 p.m. (0700 GMT) on Sunday, 10 of which were outside areas that are under quarantine. The city is scrambling to stamp out such community infections. More